GNER passengers will have to pay &#163;1.3bn train fare

The £1.3bn to be paid by Great North Eastern Railways (GNER) to the Treasury over the next 10 years must come from passengers' pockets, the company's chief executive admitted yesterday. Christopher Garnett indicated there was no question of GNER absorbing some of the cost and that fares would need to rise to pay the subvention to the state.

Appearing before the Commons Transport Committee, Mr Garnett said: "There is only one place we can recoup it from, that is why we have got to attract as many passengers as we can.'' He insisted there was a strict limit to the amount fares would rise because passengers had the option of taking flights on longer journeys. GNER retained its franchise this year to run services on the flagship London to Edinburgh line after promising to pay a higher premium to the Treasury than other bidders.

Mr Garnett said it was difficult to use GNER's website to find what fares apply to which services, and said easyJet's was simpler.

Sir Rod Eddington, the former British Airways chief and now the Government's most senior transport adviser, told the committee Britain's planning system needed radical reform if transport infrastructure was to be properly planned. He said it was "too complicated, too long, too expensive and contains too much uncertainty".